Q 2 part1

2. For each item used in the firms production budget and direct-labor budget, select the other components of the master budget (except for financial statement budgets) that also, directly or indirectly, would use these data. (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.)

1. Sales data:

• Selling and administrative expense budget unanswered
• Production-overhead budget unanswered
• Direct-material budget unanswered
• Cash budget unanswered
• Cost-of-goods-sold budget unanswered
• Sales budget unanswered
• Cash disbursements budget unanswered

2. Production data:

• Selling and administrative expense budget unanswered
• Direct-material budget unanswered
• Cost-of-goods-sold budget unanswered
• Production-overhead budget unanswered
• Cash budget unanswered
• Cash disbursements budget unanswered
• Sales budget unanswered

3. Direct-labor-hour data:

• Selling and administrative expense budget unanswered
• Production-overhead budget unanswered
• Direct-material budget unanswered
• Cash budget unanswered
• Cost-of-goods-sold budget unanswered
• Sales budget unanswered
• Cash disbursements budget unanswered

4. Direct-labor cost data:

• Selling and administrative expense budget unchecked
• Production-overhead budget unanswered
• Direct-material budget unanswered
• Cash budget unanswered
• Sales budget unanswered
• Cost-of-goods-sold budget unanswered
• Cash disbursements budget unanswered

Spiffy Shades Corporation manufactures artistic frames for sunglasses. Talia Demarest, controller, is responsible for preparing the company's master budget. In compiling the budget data for 20x1, Demarest has learned that new automated production equipment will be installed on March 1. This will reduce the direct labor per frame from 3.0 hours to 2.75 hours. Labor-related costs include pension contributions of $1.05 per hour, workers' compensation insurance of $0.75 per hour, employee medical insurance of $3 per hour, and employer contributions to Social Security equal to 8.00 percent of direct- labor wages. The cost of employee benefits paid by the company on its employees is treated as a direct-labor cost. Spiffy Shades Corporation has a labor contract that calls for a wage increase to $19.00 per hour on April 1, 20x1. Management expects to have 24,600 frames on hand at December 31, 20x0, and has a policy of carrying an end-of-month inventory of 100 percent of the following month's sales plus 40 percent of the second following month's sales. These and other data compiled by Demarest are summarized in the following table. January February March April May Direct-labor hours per unit 3.0 3.0 2.75 2.75 2.75 Wage per direct-labor hour $ 17.00 $ 17.00 $ 17.00 $ 19.00 $ 19.00 Estimated unit sales 17,000 19,000 15,000 16,000 16,000 Sales price per unit $ 64.00 $ 61.50 $ 61.50 $ 61.50 $ 61.50 Production overhead: Shipping and handling (per unit $ 3.00 $ 3.00 $ 3.00 $ 3.00 $ 3.00 sold) Purchasing, material handling, and inspection (per unit produced) $ 4.00 $ 4.00 $ 4.00 $ 4.00 $ 4.00 Other production overhead (per direct- ect- $ ERA 5.00 $ 5.00 $ 5.00 $ 5.00 $ 5.00 labor hour)